Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Biotech / Medical : Sepracor-Looks very promising -- Ignore unavailable to you. Want to Upgrade?

To: Robohogs who wrote (3207)	6/4/1999 8:27:00 AM
From: BMcV	Read Replies (1) \| Respond to of 10280

from Reuters: Sepracor jumps after favorable analyst report By Ransdell Pierson NEW YORK, June 3 (Reuters) - Shares of Sepracor Inc. <SEPR.O> jumped Thursday after Morgan Stanley Dean Witter issued a laudatory report on the drug maker, calling its shares "oversold" and predicting favorable company developments in the second half of 1999. Shares of the Marlborough, Mass., company were up $6.69 to $69.50, or 10.7 percent, in afternoon trade. Even so, the stock remains about 50 percent below its lifetime closing high of $139.37 set on March 8. "The Morgan Stanley report was enough to drive the stock," said Jefferies & Co. chief market analyst Arthur Hogan, who added there was little other news Thursday about Sepracor. Morgan Stanley analyst Douglas Lind reaffirmed his "strong buy" rating on Sepracor, saying controversies over some company products and a broader move on Wall Street out of health-care stocks had seriously hurt its share price in the past three months. "In our view, current levels present a prime opportunity to accumulate shares ahead of a robust stream of positive news flow expected in the second half of 1999," Lind said, referring to Sepracor stock.. Sepracor specializes in making slightly altered forms of existing drugs meant to be safer than the original compounds. Its recent business strategy has been to license its experimental "improved" versions to larger drug companies that own and market the original compounds. With each new licensing deal, Sepracor's share price has leaped in the past year. Shares have also retreated, however, as setbacks appeared on the company's march to commercialization of its broad pipeline of drugs. Sepracor agreed in late 1997 to license to Schering-Plough Corp. <SGP.N> its worldwide rights to a compound closely related to Schering's top-selling antihistamine Claritin. In early 1998, Sepracor licensed to Johnson & Johnson <JNJ.N> an altered version of J&J's antihistamine Hismanal. And last December, Eli Lilly and Co. <LLY.N> agreed to pay Sepracor $20 million plus up to another $70 million in later payments for global rights to Sepracor's altered version of Lilly's blockbuster Prozac antidepressant drug. Investors grew jittery, however, when the U.S. Federal Trade Commission (FTC) later requested additional information about the Lilly/Sepracor agreement -- raising concern the agency might pose antitrust objections. In his report Thursday, Morgan Stanley's Lind said he believed the FTC would approve the Sepracor/Lilly deal on Sepracor's version of Prozac -- called (R)-fluoxetine -- by the end of the year. Sepracor shares fell about 10 percent on April 19 after Bear, Stearns analyst David Maris raised concern about a letter to Sepracor from the U.S. Food and Drug Administration alleging the company had issued a press release overstating the safety and efficacy of its newly approved asthma drug Xopenex. The FDA sent a second letter to Sepracor on May 21 alleging the company had made similar unsubstantiated claims about Xopenex in promotional ads and "Dear Doctor" letters. "These letters do not concern us," Lind wrote in his research report Thursday, saying the FDA's Division of Drug Marketing, Advertising and Communications routinely sends such letters to drug companies cautioning them not to exaggerate the benefits of their drugs. On May 14, Sepracor shares fell sharply after J&J reversed gears and decided for strategic reasons to discontinue development of Sepracor's version of Hismanal, called norastemizole. Lind said Thursday that Sepracor was aggressively testing the experimental antihistamine on its own and could complete clinical trials by late 1999, adding that so far the "data look good."